Financial Restrictions, Personal Income Tax (PIT) and Demand for a Permanent Home in a Dynamic Model. An analysis with Panel Data for Spain
AbstractThis paper analyzes the way in which income tax and liquidity determine the purchase or rental of a permanent home in Spain. To do this, we have developed a theoretical dynamic model based on Euler’s equation. This model is verified using a sample from the 1991-1995 Panel of income taxpayers. Results suggest that the degree of financial restriction is the most relevant variable when determining the possibility of purchasing a home, while tax incentives increase their relative weighting once this asset has been acquired. Incentives for renting a home are relatively insignificant particularly for taxpayers who habitually rent their homes.
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Bibliographic InfoPaper provided by EconWPA in its series Public Economics with number 0407005.
Length: 25 pages
Date of creation: 08 Jul 2004
Date of revision:
Note: Type of Document - pdf; pages: 25
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personal income tax; liquidity; permanent home; tax incentives;
Other versions of this item:
- Cesar Pérez-López & Desiderio Romero-Jordan, 2004. "Financial Restrictions, Personal Income Tax (PIT) and Demand for a Permanent Home in a Dynamic Model. An analysis with Panel Data for Spain," Public Economics 0407007, EconWPA.
- Cesar Pérez-López & Desiderio Romero-Jordan, 2004. "Financial Restrictions, Personal Income Tax (PIT) and Demand for a Permanent Home in a Dynamic Model. An analysis with Panel Data for Spain," Public Economics 0407006, EconWPA.
- H21 - Public Economics - - Taxation, Subsidies, and Revenue - - - Efficiency; Optimal Taxation
- H24 - Public Economics - - Taxation, Subsidies, and Revenue - - - Personal Income and Other Nonbusiness Taxes and Subsidies
- H31 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - Household
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- Stiglitz, Joseph E & Weiss, Andrew, 1981. "Credit Rationing in Markets with Imperfect Information," American Economic Review, American Economic Association, vol. 71(3), pages 393-410, June.
- Miguel Angel López García, 1992. "Algunos aspectos de la economía y la política de la vivienda," Investigaciones Economicas, Fundación SEPI, vol. 16(1), pages 3-41, January.
- Jorge Onrubia Fernández & Desiderio Romero Jordán & José Félix Sanz Sanz, . "Una Nota Sobre La Compensación De Incentivos A La Adquisición De Vivienda Habitual Tras La Reforma Del Irpf De 1998," Working Papers 34-02 Classification-JEL , Instituto de Estudios Fiscales.
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